How to Start an LLC in South Carolina

Many small business owners decide to form a limited liability company (LLC). An LLC is a popular business structure because it combines the limited liability of a corporation with the lack of formalities of a partnership or sole proprietorship. With an LLC, you can also choose how your company is taxed.

Follow these steps to create an LLC in Wisconsin. For more information on how to form an LLC in any state, see our article on how to start an LLC.

1. Choose a Name for Your South Carolina LLC

Under South Carolina law, an LLC name must contain the words "limited liability company" or "limited lompany," or the abbreviations "L.L.C.," "LLC," "LC," or "L.C." The word "limited" can be abbreviated as "ltd." and the word "company" can be abbreviated as "co." (S.C. Code § 33-44-105 (2023).)

Your LLC's name must be distinguishable from the names of other business entities already on file with the South Carolina Secretary of State (SOS). In other words, your business can't share a name with any business that has registered to do business in South Carolina or that has reserved a name with the SOS. (S.C. Code § 33-44-105 (2023).)

Names can be checked for availability at the SOS's business name database.

If you've picked out a name for your business but aren't ready to file your formation paperwork with the SOS, then you can reserve your name until you're ready to file. You can reserve a name for 120 days by filing an Application to Reserve a Limited Liability Company Name with the SOS's Corporations Division. The reservation must be filed by mail. The filing fee is $25.

2. Appoint a Registered Agent for Your South Carolina LLC

Every South Carolina LLC must have an agent for service of process in the state—often called a "registered agent." This agent agrees to accept legal papers on the LLC's behalf if it's sued. The registered agent can be:

• a South Carolina resident
• a South Carolina business, or
• an out-of-state company authorized to do business in South Carolina.

The registered agent must have a physical street address in South Carolina. (S.C. Code § 33-44-108 (2023).)

3. File Articles of Organization

A South Carolina LLC is created by filing articles of organization with the SOS. The articles must include:

• the LLC's name
• the name and address of the LLC's registered agent
• the address of the LLC's initial office
• the name and address of each organizer
• whether the LLC will be member-managed or manager-managed, and if the LLC is manager-managed, the manager's name and address
• whether the company will only last for a specific period and, if so, specify the term, and
• whether any of the members will be liable for the LLC's debts and obligations.

(S.C. Code § 33-44-203 (2023).)

The articles can be filed online or by postal mail. To file online, you must register and create a user name and password. As of 2023, the filing fee is $110.

4. Prepare an Operating Agreement

An LLC operating agreement isn't required in South Carolina. However, you should create one for your company. An operating agreement is an internal document that establishes how your LLC will be run. It's not filed with the state.

This foundational document sets out the rights and responsibilities of the members and managers, including how the LLC will be managed. At a minimum, the operating agreement should include the following:

• the members' percentage interests in the LLC
• the members' rights and responsibilities
• the members' voting powers
• how profits and losses will be allocated
• rules for holding meetings and taking votes, and
• buyout (or buy-sell) provisions, which determine what happens when a member wants to sell their interest, dies, or becomes disabled.

Besides creating a framework for your company operations, an operating agreement can help preserve your limited liability. It can show that your LLC is truly a separate business entity from the owners.

In the absence of an operating agreement, state LLC law will govern how your LLC operates.

5. Get an EIN and Comply With Tax and Regulatory Requirements

Other tax and regulatory requirements might apply to your LLC. These additional requirements include the following:

Obtaining an EIN. If your LLC has more than one member, you must obtain a federal employer identification number (EIN) for your company, even if it has no employees. If you form a single-member LLC, you must obtain an EIN for it only if it'll have employees or you elect to have your LLC taxed as a corporation instead of a sole proprietorship (disregarded entity). You can obtain an EIN by completing an online EIN application on the IRS website. There's no filing fee.

Applying for business licenses. Depending on its type of business and where it's located, your LLC could need to obtain local and state business licenses. For more on which licenses, permits, and registrations you might need, see our article on how to get a small business license in South Carolina.

Registering with the South Carolina Department of Revenue (DOR). In some cases, for example, if you have employees or will be selling goods and collecting sales tax, you'll need to register with the South Carolina Department of Revenue (DOR). You can register your business online using MyDORWAY. For more information on state LLC tax registration, check out our article on LLC annual report and tax filing requirements in South Carolina.

South Carolina LLC FAQ

Below you can find answers to frequently asked questions about starting, managing, and dissolving an LLC in South Carolina.